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AWS Closes Q3 Bigger Than The Next Five Providers Combined

Synergy Research's calculations peg Microsoft, Google and Alibaba as the only providers that grew faster than 80 percent in Q3. The market as a whole saw red-hot 40 percent growth.

Amazon Web Services grew in the third quarter just slightly faster than the red-hot cloud market it led as infrastructure, platform and hosted private cloud services scaled to become a $12 billion industry, according to Synergy Research.

With 42 percent growth, AWS inched up its overwhelming market share advantage by outperforming a market that grew by 40 percent overall. Synergy develops proprietary models for determining revenue for providers that don't break out their cloud segments.

In Q3, three providers climbed in share even faster than AWS by achieving growth above 80 percent: Microsoft and Google, Amazon's traditional hyper-scale competitors with 12 and 6 percent market share respectively, and Alibaba.

[Related: Hyper-Scale Cloud Providers Chasing AWS Gained Market Share Last Year, But They Didn't Take It From AWS]

Alibaba, the Chinese e-commerce powerhouse, still only saw a tiny share, 3 percent, of global cloud revenue, despite its rapid gains.

IBM remains lodged as the third-largest cloud provider, behind Amazon and Microsoft, with 8 percent of the market. But while Big Blue's "sweet spot" of private cloud hosting is gaining share, the overall cloud business grew below 40 percent, said Synergy's chief analyst John Dinsdale.

"Rounding out the top eight cloud providers, Oracle continues to grow strongly, albeit from a small base, while Salesforce and Rackspace maintain a strong position in specific niche segments of the market," Dinsdale said in a press release about the report.

The quarter concluded at the end of September with Amazon still holding slightly more market share than the next five companies below it. Dinsdale described AWS' growth as "a little shocking" given its current size.

Oracle matched Alibaba with a 3 percent share, but cloud growth Synergy pegs at between 40 and 60 percent fell short of the Chinese company. Salesforce, the only one of the eight leaders that doesn't offer Infrastructure-as-a-Service, held 4 percent share on the strength of its development platforms.

Rackspace, which has transitioned its business model significantly over the last year toward managing services across cloud providers, still enjoys 2 percent of global cloud revenue. But it's growth fell short of 40 percent.

As the battle intensifies at the top tiers of the market, smaller players are being muscled out.

"It is becoming increasingly difficult for cloud providers outside of the leading pack to make an impression on the market share rankings,’ Dinsdale said in the report's press release.

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